Watch out Kindle 2, Nook, and iPad: Google’s selling e-books soon

There’s already some heated competition in the e-book reader space between Amazon’s Kindle 2, the Barnes & Noble Nook, and Apple’s iPad but Google is set to make its own entry in the coming months. The service will be called Google Editions and at launch it will provide access to about 500,000 titles. In comparison Amazon advertises “more than 500,000 books,  newspapers,  magazines,  and blogs” in its Kindle store. In other words Google will have a very solid number of books available right at launch.

It’s a slap in the face to Amazon who’s been in the e-book reader space for a while now and has had to work hard to pull publishers along. That’s part of Amazon’s cost for being a thought leader, and in order to stay ahead of the competition it’s probably time for Amazon to start making noise about a next generation Kindle.

Of course Google Editions could end up playing nicely with the Kindle 2, Nook and iPad but Google could also decide to develop its own e-reader device to compete on its own terms. The company certainly isn’t shy about exploring new business paradigms, just look at its recent experiment with selling the Nexus One mobile phone directly to customers. Google will almost certainly develop an app for its open source Android mobile operating system and that opens up immediate access to an already burgeoning market of customers.

Authors would continue to get a cut of profit from publishers and also have the potential to sell e-books from their own web sites through an embedded widget. Overall “publishers will get 63 percent of the revenue from book sales and Google takes the rest,” according to PC World.

That seems consistent with how Google negotiates most business arrangements where it provides a delivery mechanism and/or platform in exchange for a percentage of revenue.